The Mystery of the Canceled Yahoo Dinner Solved! Or Is It?

Recently, BoomTown, along with a passel of press, was invited to an outreach dinner, set to be held on June 9 at a San Francisco venue, with some top Yahoo (YHOO) execs.

This was somewhat of a big deal, given the typically cave-dwelling mentality of the company in recent days, due to the drama of the Microsoft (MSFT) takeover bid that has jacked Yahoo’s typically skittish approach to press relations up to dangerously shy levels.

Thus, the appearance of a herd of important ones felt epic: Network head Jeff Weiner, along with a trio of SVPs–Front Door and Network Services’ Tapan Bhat, Brad Garlinghouse, who heads Yahoo’s communications and communities arenas, and Yahoo Search’s Vish Makhijani.

The point? To talk up all the various initiatives at the company and to try to focus on the actual operating units, rather than the endless MicroHoo drama that has consumed every little bit of mindshare related to Yahoo.

The operating units at Yahoo have, in fact, been largely kept out of the acquisition maelstrom, except for being drawn in to comment on the feasibility of various schemes like a Google (GOOG) search-ad outsourcing deal.

Then the dinner was canceled last week suddenly, with organizers blaming scheduling issues.

That move set tongues wagging at Yahoo’s Sunnyvale, Calif., HQ, of course, and sources inside the company began to pepper BoomTown with two key theories.

The first: That Yahoo was very close to a deal with Microsoft, which could come over the weekend, and therefore it did not want to be trotting key execs in front of the press at what might be a delicate time.

While the cancellation of the dinner apparently came from corporate, at this moment–which could change at any moment, of course–that seems unlikely.

While many feel like Microsoft’s only way to best rival Google is to renew its efforts to buy Yahoo and is the only true option that would give the software giant any kind of real scale in the search arena, several sources told me that Microsoft is currently in a wait-and-see holding pattern as it considers its various alternatives.

“Microsoft is in no rush with Carl Icahn doing all the heavy lifting,” said one source, referring to the hopping-mad billionaire investor who is waging a proxy fight against Yahoo.

Another said the company is in a deep evaluation mode on what to do with plenty of time to contemplate its options, especially since Microsoft now has major Yahoo shareholders pining for a $33 per share price, rather than the higher figures once bandied about.

And, except for the threat of a Yahoo-Google search-ad hookup, which has been pending for a while, noted the source, “[CEO Steve] Ballmer does not have to move yet.”

But an even more intriguing second theory surrounded Weiner (pictured here), the high-profile exec who is in charge of Yahoo’s many products from content to email to search to communities.

Several execs at Yahoo suggested to me that the reason for the cancellation was because he might be on his way out the door soon, a rumor that was started when Weiner took two weeks off upon the recent birth of his first child (Hey, congrats! Try to get sleep before colic starts in!) and then extended the leave two more weeks.

But after a bit of BoomTown sleuthing, it seems that a Weiner departure is not imminent–at least for now–and that he is likely to be back on the job after he perfects the art of swaddling. (Some advice for Jeff: Surrender now.)

But the notion of what the future holds for high-ranking execs like Weiner got me thinking that it is likely Yahoo will have to grapple with the issue more seriously in the coming months.

And the question of how Yahoo is going to hang onto top talent–while it sits in what is essentially a limbo until its August board meeting resolves the Icahn fight–is a very important one going forward.

Because if Yahoo manages to remain largely independent, there will still be the nagging question of who should be the leaders of the company, especially given the buzzsaw that CEO Jerry Yang and President Sue Decker have been and will continue to go through.

And, if it gets bought, likely by Microsoft, a lot of key execs will obviously be faxing off their resumes, despite what are likely to be huge retention packages.

In both cases too, one must factor in sheer exhaustion brought on by the turmoil among the Yahoo troops, which cannot be underscored enough.

In many more conversations I have had with employees of late, there is a decided increase in the weariness factor with the situation and a feeling that the road ahead will be even more daunting.

And how to overcome that will be perhaps the greatest mystery of all for Yahoo’s leadership to solve going forward.

AllThingsD by Writer

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